ALBANY -- A federally funded program will see whether paying people in New York to go to the doctor and take medication will ultimately save money and promote healthy living.

About 16,700 study participants statewide who are smokers, pre-diabetic, diabetic or have high blood pressure will receive debit-card payments of up to $250 each to work toward getting healthier.

The program was initially set to target smokers in western New York and treat the other three conditions in New York City, but the state Department of Health said this week that it would open the program up to include Medicaid recipients anywhere in the state. Department officials did not explain why.

As a component of President Obama's Affordable Care Act, the initiative is under way in nine states, including New York, Texas and California. New York's grant award is $10 million over five years.

Called Medicaid Incentives for Prevention of Chronic Diseases, the program seeks to improve health outcomes and save on emergency-care costs in the long run for poor and disabled people who receive government health insurance. New York spends more than $1 billion a week on Medicaid -- more than any other state.

"The intention from the federal government is that ultimately it would be a cost saver," Gov. Andrew Cuomo said about the program at a recent news conference.

It is unclear when the state will launch the initiative. The health department must first identify and contract with a company that will load and distribute the debit cards.

The department's request for proposals from the vendors originally had a late-November deadline, but it was recently extended into December as a result of Superstorm Sandy. The federal grant is valid through September 2016.

Michael Long, chairman of the state Conservative party, called the program "outrageous," saying it is an abuse of public money. He said it would be impossible to hold the study participants involved accountable.

"Clearly, just because someone gets paid to go to the doctor doesn't mean a diabetic is going to stop eating jelly doughnuts," he said.

Blair Horner, vice president for advocacy for the American Cancer Society of New York and New Jersey, defended the program. He said efforts to tackle smoking are badly needed, especially upstate, where lung cancer rates are high.

"It's very expensive to treat lung cancer, and it's a long and painful and horrible death," he said. "So if this pilot works and gives new insights into ways to get smokers to quit, then it will be worth it."

Lara Kassel, coordinator of Medicaid Matters New York, an advocacy group, said the program has merits.

"Medicaid Matters is supportive of incentives if they are provided in a way that will effectively help eliminate health disparities and promote good outcomes," she said in a statement.

The state is working on other ways to cut Medicaid costs. Cuomo formed a Medicaid Redesign Team in January 2011 to identify potential savings. Implementing phase one of the team's recommendations is estimated to save the state and federal governments $34 billion -- about half to each -- over five years.

The health department has not yet worked out details of the federal incentives program, such as how many people with each condition will participate or how it will be administrated. The department will choose study participants; eligibility will be based on health behaviors, risk factors and diagnoses.

Under the study's guidelines, smokers who attend smoking-cessation counseling or fill prescriptions for related medication can receive up to five payments of $50. Those who test negative for nicotine once can receive up to $100, and twice, up to $150.

Patients who are at risk of developing diabetes will be rewarded for attending a prevention program and making progress toward a 5 percent weight loss.

Participants who have diabetes will be paid for attending appointments with primary care physicians, filling prescriptions related to their illness or showing healthy blood-sugar levels. Similarly, for those with hypertension, the study will provide incentives for attending doctor's visits and achieving normal blood pressure.

In order to measure how effective the compensation is, the amount of money participants can earn will vary, and some participants will earn nothing.

Long said the program sends a bad message.

"People have a personal responsibility to take care of themselves. They know what they're supposed to do," Long said. "If you don't feel well, you don't need to be paid to go see the doctor with other people's money."

Assemblywoman Crystal Peoples-Stokes (D-Buffalo) said she was initially skeptical of the program but has since embraced it.

PEOPLES-STOKES: The cost of health care is steadily going up. Even for the healthiest people, it's going up. And so, if there is some ways that we can begin saving money on health care, we should do it.

REPORTER: Do you see how the idea of this would rub a lot of people the wrong way?

PEOPLES-STOKES: Yeah. I do. And I see how the idea of a lot of things that happen in society rubs people the wrong way. But that doesn't mean people can just throw up their hands and say, we're out. We're not in. We're all in.